Compared to manufacturers, distributors are facing even greater difficulties overall. In fact, the overall difficulties of manufacturers stem from those of distributors. Now many manufacturers have added e-commerce platform sales alongside traditional channel sales, launching both 2B (deep distribution) and 2C (platform e-commerce) strategies. However, distributors believe they are naturally 2B, and the difficulties of 2B are hard to overcome due to the struggles of traditional terminals. Recently, I have been in contact with some distributors who, besides feeling the difficulty of breaking through sales volumes, most importantly do not know where hope lies or where the breakthrough point is. Based on my judgment, although individual differences among distributors are large, there are two bottlenecks that have not been widely recognized: first, how to extend 2B business to BC integration; second, changes in the distributor organizational system. -01- Breakthrough Point One: From 2B to BC Integration Distributor 2B is traditional deep distribution. Deep distribution reaches the terminal, and the terminal is the end point, unable to extend further. Moreover, with current products, relying solely on distribution coverage is no longer effective. As many distributors say: they have thought of everything, done everything, and have no more tricks. Customer relations + distribution + promotion are the traditional skills of distributor 2B. Although there is room for improvement, the input-output ratio is generally not cost-effective. At the same time, we also see some personalized products that complete 2C through traditional channels and operate well through BC integration. Although sales volume is not large compared to 2B, gross margins are very high. For 2B products, channel profits mainly lie in retail, and distributor gross margins are low, relying mainly on volume. BC-integrated products are relatively high-end with higher gross margins. Additionally, they obtain both wholesale and retail profits, resulting in larger profit margins. BC integration does not mean directly going 2C, but rather using 2C to pull 2B, with main sales still achieved through 2B. This may be the mainstream channel model in the future. Traditional deep distribution solves terminal distribution and promotion through terminal customer relations and interests. This method is already difficult to be effective. Coupled with the current general lack of brand promotion capability among manufacturers, the "push" of deep distribution alone is very difficult. However, as long as BC integration is implemented and the C-end moves, the B-end will definitely move. This is currently a very effective method. Reaching the C-end through channels was unimaginable in the past, but now it is not difficult. In fact, solving the C-end is relatively easier than solving the B-end. Once the C-end is solved, the B-end will follow. The "push" of 2B, combined with the "pull" of 2C, will form a channel system combining "push and pull" in the future. When I first proposed BC integration in 2019, many did not understand. BC integration is definitely not the manufacturer's BC integration, but rather achieving BC integration through distributors. From my understanding, it is difficult for old salespeople of distributors to transition from 2B to BC integration. Now breakthroughs must be made in the "three new": new people, new products, and new methods. First, find products suitable for BC integration. Old products are basically unsuitable, and the profit system is also not suitable. Second, find new people who start with BC integration from the beginning, unaffected by traditional 2B inertia. Third, find new methods. In fact, every city has such distributors, but traditional distributors just do not pay attention. When I communicate with distributors, I can always quickly search out such distributors from their surroundings. Because as long as BC integration is done, it can be found. -02- Breakthrough Point Two: Transforming the Organizational System The bottleneck of traditional distributors actually appeared before the internet era, which is organizational capability. Many think that the size a distributor can achieve depends on capital, products, etc. In fact, to put it bluntly, the core is how many people the distributor can lead. The larger the team you can lead, the bigger the battle you can fight. I divide distributors into several levels based on how many people they can lead: First, the mom-and-pop shop. They can only do it themselves and cannot lead others. Or they bring along relatives, friends, or acquaintances' children. Second, those who can lead 10-30 people. Such distributors are already quite capable; at least they have a team. They generally manage by brand or region. Third, those with more than 30 people, some up to hundreds. This requires professional division of labor and a sound organizational management. Such distributors generally do not participate in daily operations and have professional managers involved in management. Now, all three models are facing difficulties. Difficulty in recruiting and managing is already a traditional problem. More importantly, BC integration, reaching the C-end, requires salespeople to participate around the clock and contribute their personal networks. Thus, a new organizational model for distributors, "Platform + Small Unit Organization", has emerged. The distributor becomes a public platform providing brand, capital, warehouse, vehicles, etc. The small unit organization is essentially second-level partners, turning excellent employees into "second bosses." Note that I advocate for second-level partners; first-level partners are not very meaningful. Second-level partners are not dry shares; they must invest real money. Bosses naturally do not need management; they have no concept of working hours. As Mencius said: "Those who have constant property have constant hearts." There are many pitfalls in the distributor partnership system. To avoid pitfalls, learn more from successful practitioners. At least, do not step into pits that others have already stepped into. The partnership system greatly weakens the need for management, and the lack of organizational management capability is a common problem among distributors. Source: Teacher Liu's New Marketing (ID: liuchunxiong1964)